Enhancing
Decision Making
Yosepha Hartana - 18061102131
Aneilla Laserto - 18061102296
Celina Rawung - 17061103004
12.1
DECISION MAKING AND
INFORMATION SYSTEM
Decision making in business used to be
limited to management.
BUSINES VALUE OF IMPROVED
DECISION MAKING
TYPES OF DECISIONS
Decisions are classified as :
Unstructured
Structured
Semistructured
THE DECISION - MAKING PROCESS
There are 4 step of decision making proces :
Intelligence
Design
Choice
Implementation
MANAGERS AND DECISION
MAKING IN THE REAL WORLD
information systems cannot improve all
the diferent kinds of decisions taking
place in an organization.
MANAGERIAL ROLES
Their responsibilities range from making decisions, to writing reports, to
atending meetings, to aranging birthday parties. We are able to beter
understand managerial functions and roles by examining clasical and
contemporary models of managerial behavior.
The classical model of management
Behavioral models
Managerial roles
Interpersonal roles
Informational roles
Decisional roles
REAL - WORLD DECISION MAKING
Managerial roles where information systems might improve
decisions,investments in information technology do not always produce
positive results.
There are three main reasons :
Information quality
Management filters
Organizational culture
HIGH - VECOLITY AUTOMATED DECISION MAKING
many decisions made by organizations are not made by managers, or any
humans. For instance, when you enter aquery into Google’s search engine,
Google has to decide which URLs to display in about half a second on average
(500 milliseconds). Google indexes over 50 billion Web pages, although it
does not search the entire index for every query it receives. The same is true
of other search engines. The New York Stock Exchange is spending over
$450 millionin 2010–2011 to build a trading platform that can executes
incoming orders in less that 50 milliseconds. High frequency traders at
electronic stock exchanges execute their trades in under 30 milliseconds.
12.2
BUSINESS INTELLIGENCE IN
THE ENTERPRISE
Business intelligence is a term used by hardware and
software vendors and information technology
WHAT IS BUSINESS consultants to describe the infrastructure for
INTELLIGENCE ? warehousing, integrating, reporting, and analyzing data
that comes from the business environment.
The foundation infrastructure collects, stores, cleans,
and makes relevant information available to managers
BUSINESS INTELLIGENCE VENDORS
It is important to remember that business intelligence and analytics are
products defined by technology vendors and consulting firms. They
consist of hardware and software suites sold primarily by large system
vendors to very large Fortune 500 firms. The largestfive providers of
these products are SAP, Oracle, IBM, SAS Institute, and Microsoft
THE BUSINESS INTELLIGENCE
ENVIRONTMENT
THER ARE SIX ELEMENTS IN THIS BUSINESS
INTELLIGENCE ENVIRONMENT :
Data from the business
environment
Business intelligence infrastructure
Business analytics tool set
Managerial users and methods
Delivery platform — MIS, DSS, ESS
User interface
BUSINESS INTELLIGENCE AND
ANALYTICS CAPABILITIES
THERE ARE 5 ANALYTIC FUNCTIONALITIES THAT BI
SYSTEMS DELIVER TO ACHIEVE THESE ENDS :
Production report
Parameterized reports
Dashboards/Scorecards
Ad hoc query/search/report creation
Drill down
Forecast, scenarios, models
MANAGEMENT STRATEGIES FOR
DEVELOPING BI AND BA
CAPABILITIES
TThere are two different strategies for adopting
BI and BA capabilities for the organization :
one-stop integrated solutions versus
multiple best-of-breed vendor slutions
- The first solution carries the risk that a single vendor provides your
firm's total hardware and software solution
- The second solution offers greater flexibility and independence, but
with the risk of potential difficulties integrating the software to the
hardware platform, as well as to other software
12.3
BUSINESS INTELLIGENCE
CONSTITUENCIES
DECISION SUPPORT FOR OPERATIONAL
AND MIDDLE MANAGEMENT
Operational and middle management
are generally charged with
monitoring the performance of key aspects of the business, ranging
from the down-time of machines on a factory floor, to the daily or even
hourly sales at franchise food stores, to the daily traffic at a company’s
Web site. Most of the decisions they make are fairly structured.
DECISION SUPPORT FOR SENIOR MANAGEMENT :
BALANCED SCORECARD AND ENTERPRISE
PERFORMANCE MANAGEMENT METHOD
(ESS), introduced in Chapter 2,
The purpose of executive support systems
is to help C-level executive managers focus on the really important
performance information that affect the overall profitability and success
of the firm. There are two parts to developing ESS. First, you will need a
methodology for understand- ing exactly what is “the really important
performance information” for a specific firm that executives need, and
second, you will need to develop systems capable of delivering this
information to the right people in a timely fashion.
GROUP DECISION SUPPORT SYSTEM (GDSS)
primarily on individual decision
The DSS we have just described focus
making. However, so much work is accomplished in groups within firms that a
special category of systems called group decision-support systems (GDSS)
has been developed to support group and organizational decision making.
A GDSS is an interactive computer-based system for facilitating the solution
of unstructured problems by a set of decision makers working together as a
group in the same location or in different locations.